Tag: buy a franchise

You Don’t Have To Start A Business Alone

During this time of Covid, many people are thinking of starting a business. The fear of starting out on your own is a major stumbling block.

Read this post; These are the reasons not to run a business alone.

I am here to tell you there is a way to overcome that fear, franchise business ownership.

The franchise business model is a proven formula that you can easily follow. It is a great way to be in business for yourself and not by yourself. That is why there are 773,603 franchise establishments in 2019 and franchising a major driving factor in the US economy.

You should start by understanding your strengths and skills.

To learn more about franchise opportunities in your area, go to my calendar and set up a time for us to talk.

 

Using A Proven Method To Find The Right Franchise

Trying to find the right franchise can be frustrating. After all, there are nearly 3500 franchises in the world today.

For most people, they have no idea how to determine if a franchise opportunity is right for them.

Finally, who do you trust?

All of this leads in two directions. You get stuck in what we call, “Paralysis by Analysis” or you just give up and look for a J-O-B (which is why you started looking in the first place).  In either case, the major factor is fear or just lack of knowledge about the opportunity.

So what is a good shortcut to finding the right franchise?

Start by understanding your strengths and skills. This will save you time and frustration in the long run.

How bad do you want to be your own boss? Use our shortcut, it only takes about 10 minutes and you will learn your strengths, skills and more importantly what business culture is the best fit for you.

Click Here for Our Shortcut.

 

List of Franchise Industries still open during Covid-19

Social Distancing

You probably never consider what was an “essential” or “non-essential” business until the Coronavirus Pandemic. You probably never thought  we would see a time when ONLY “essential business” would remain open. It has been left up to state and local governments to determine which businesses are essential or non-essential. But there have been many businesses that have been deemed essential by everyone.

I thought it might be interesting to start a list of franchise industries that are open and doing business. When you think about all the advantages of buying a franchise over starting from scratch, no one ever considered a national shutdown. Franchisors have been working hard to help their franchisees during this time. The type of support that a stand-alone business would not have access.

Here is a list of industries that are still open:

  • Disaster, Recovery, and Restoration
  • Automotive
  • Pet Related
  • Packing and Shipping
  • Fast Food (that have Drive-Thru or can offer Curbside service)
  • Pest Control
  • Home Services
  • Senior Care
  • Moving Companies

Financing the Start of Your Franchise

Deciding to start a business is exciting and scary. There are many considerations but depending on your business plans and overall goals. Choosing to buy a franchise can help solve many of the problems when starting a new business, especially if it is an established brand with a loyal consumer base. It does not solve then need for financing. You may still need to find financing. Here are several options and we are here to help you find the one that works best for you.

Franchisor

A great option for financing is from the franchisor directly. Granted, this is not offered through every franchise, but a growing number of reputable businesses are offering this potential funding solution. In fact, several companies even help to guarantee the loan in case of franchisee default. If interested in franchisor funding, then look under item 10 of the FDD to see if it is offered.

SBA Loans

The Small Business Administration offers partial guarantees to third-party lenders to help reduce the risk of lending to new ventures or franchise developments. Many franchisors are approved by the SBA, meaning that the loan process is streamlined, not guaranteed. The 7(a) loan program is the most beneficial program for franchisees and has a cap of $2 million.

Family and Friends

While it is a nice idea to partner with family or friends in a business venture, it is vital that the details of the partnership are laid out in a legally binding agreement. These agreements offer clarity and specify obligations, which help to avoid potential personal and professional conflict later.

Online Lenders

Many online lenders may be happy to work with a new franchisee, but not everyone is aware of this potential marketplace. There are several websites available that act as intermediaries between lenders and borrowers. Essentially borrowers create a loan request, the intermediary site then posts the request to its pool of potential lenders to find a suitable loan match, which can be a line of credit, bank loan, SBA loan, etc.

Retirement and C Corporations

One of the last options available to a franchisee is to use their retirement accounts. Now, since there are penalties for removing these funds early, they can establish a C corporation, which would then be the owner and operator of the business. The franchisee can then roll their retirement accounts into the corporate account, investing it into the newly formed company.

A franchise can be a great opportunity and funding may be difficult, but we are here to help you navigate all the challenges of business ownership and financing.

It is possible for networking to improve your quality of life?

A study by Network Wise (see below)  has shown that networking can improve quality of life. Having a strong social network is an indicator of psychological, emotional and physical wellness. The lack of a social network is connected to poor health and increased risk of mental and physical ailment.

Strong and healthy networks lead to decreases in:

  • Dementia
  • Breast Cancer
  • Premature Death

There is more to networking, and technology is changing everything.

We traditionally think of networking as a chamber of commerce meeting, where you meet in the evening for free drinks, exchange business cards, hanging out and maybe look for a new job. Or people think it may be getting as many LinkedIn connections as possible.

Networking is changing. Network Wise has discovered that networking is used for more than getting a new job. New business opportunities are uncovered, leads are being exchanged, new scientific discoveries are being made. Technology is driving the change. With sites like LinkedIn and Alignable, we can extend our professional networks beyond our local area and with sites like Facebook and Twitter, we are able to drastically increase our social networks.

The are three types of networks: Operational, Personal and Strategic. Operational allows us to engage with people who are central to our business success. Personal allows for socialization and we can seek out mentors and share ideas with Strategic networks.

Online or Face-to-Face?

The answer is both. Even though technology has allowed us to create more far-reaching networks, face-to-face networking is still important. Online networking can increase the size of your network, but face-to-face networking can help you build more meaningful relationships. The goal of an online connection is to gain a face-to-face meeting.

Is there an opportunity to make money?

Networking’s importance increases every day. It is creating more opportunities, growing businesses, and creating jobs. The franchising industry has a way for you to get involved and develop your own groups. Network In Action is disrupting the networking industry. It is using technology to help its franchisees build long-lasting and valuable relationships. They have developed a system that has a low investment and a quick ROI. They give their franchisees the ability to give back to the community and help all its members grow their businesses and not have to sacrifice time.

Click Here to learn more about Network In Action or to start your own networking groups.

 

 

The Art and Science of Networking

Source: NetWorkWise

Tax Benefit of Owning a Business

Owning a Side Business can save you hundreds of dollars every year.

You don’t need to invest hundreds of thousands of dollars to open a business. It doesn’t need to be a full-time business to take advantage of the tax savings. It can be a part-time or side business that may grow to a point where it becomes full-time.

Most people don’t think about owning a business unless it will make them a lot of money. Making a profit is extremely important when starting a business because nobody starts a business with the idea to lose money. It may take two to three years to show a profit and start replacing your salary. But what if you could save money each year with your business while it is making very little profit or no money at all?

There are tax savings involved in running a business that many do not consider. Being an employee is the worst way to save on taxes because Uncle Sam takes a large portion out of your paycheck before you get anything. With a business, you can pay for many things using pre-tax dollars, which can save you hundreds of dollars every year. So, while on paper, your business is not making money, you are getting the savings of buying goods with money that is not being taxed.

Some of the most common deductions include:

  • Home Office Deductions
  • Business Use of Vehicle
  • Equipment
  • Business Trips
  • Health Insurance

Put Up, or Shut Up

What you really what to see are some numbers. According to the Bureau of Labor Statistics (BLS), the average income for a family 2016 was $74,664 and the most common tax bracket is 15%. This means you are paying $11,199.60 to Uncle Sam before you take home $63,363.40. The BLS estimate that the average family has $57,311 in expenditures every year. It is not surprising that the average family is struggling to get by.

Let’s see how much an average American can save by owning a business. We will look some of the expense costs (per the BLS) for the average American family and look at just a few common deductions you could see by owning a business; Auto Mileage, Home Office, Travel, and Equipment.

Transportation

According to the BLS, the average American spends $9,049 on Transportation and drives 13,474 miles per year. Let’s assume you are using 20% of your miles for business purposes. This would allow you to deduct 2,695 miles and with the 2017 IRS mileage deduction of 53.5 cents per mile, you would have a $1,442 tax deduction.

Housing

According to the BLS, the annual expense for Housing is $18,186. By working out of your home, you are able to take advantage of many tax deductions. If you were to assign 20% of your home to dedicated business use, your deduction would be $3,637.20.

What about utilities such as water, gas, electric and a dedicated phone line? The average American will spend about $2,400 on utilities. We will assume a 20% deduction which is a $480 savings per year.

Food

The average American family spends $3,008 on dining out. My wife and I are always discussing our business whenever we eat out. As a result, we expense some of our meals every month. We will assume the average American can expense 20% of their meals. The IRS only allows you to expense 50% for meals and entertainment, this would equal at 10% deduction equal to $300.80.

Travel

Financial experts suggest that the average family spend about 5% of their total income on travel, or $3,733.20. You are not able to deduct the expense for travel that is purely for pleasure, but with proper planning, you can make the trip business related. We don’t have a breakdown of the $3,733.20 (airfare, lodging, food), so we will assume that 70% is deductible. This would give the average American a total deduction of $2,613.24.

Equipment

Thanks to the new tax laws, the Section 179 provision is continued and has increased its threshold. Computer equipment and furnishings can be expensed 100%. If you need a new laptop, printer or desk, you can deduct 100% of that cost the year in which you put it in use. If we were to assume that the average American spends $1,900 on equipment and 20% is used for business, the total deduction would be $380.

How much can I save?

There are many more areas in which a business can save you money and my assumptions are on the conservative side, but if you total up just a few examples we have here:

$1,442.00 + $3,637.20 + $480 + $300.80 + $380 = $6,240.00

Based on an average income of $74,664 in the 15% tax bracket, you would be saving $1,026 per year even if your business is not making any money. Even if the business is part-time.

You will need to document every expense carefully and you should work with an accountant. There are easy to use software programs, such as Quickbooks, that make this process simple. Oh yeah, you can deduct the cost of your Quickbooks software.

Finding a business to suit your lifestyle and budget is not as hard as you think. This is one reason why you should use a Franchise Broker because they have more information than you can find on the Internet.

Dirty Words in Franchising

Secret

The Value in the Fees

Just about every time we speak to a person who inquiries about a franchise, they get turned off by the franchise fees, advertising fees, royalties and other fees a franchisor assesses their franchisees.  We get that.  As multi-unit franchisees with about $3,000,000 in revenue – we paid a lot in advertising fees and royalties.  There were a few months during the recession where we paid the franchisor more than we paid ourselves.  Were we angry – yes, if you want to be truthful?  Who wouldn’t be? 

So why not go it alone?  We get people who opt to do that.  We do not suggest that because you have to create a brand and trademark it, set up your operations platform by either finding something out of the box or paying a programmer to customize a system just for you, write your operations manual, write your HR manual, figure out who your ideal employee is (there is an art to finding a person who will fit into your culture), hire an accountant to set up your chart of accounts and figure out how to measure your key metrics, find the right retail or office space and figure out how much you really need, design your space to accommodate the needs of the business and you can see this is a very long run-on sentence that I could continue for at least 10 more lines.  Basically, I just scratched the surface of what your initial franchise fee pays for.  I also did not mention the time it saves.  We all agree time is money and many people run out of money just trying to get those doors to open.  We have seen many “mom and pops” with the coming soon only to see them go out of business in a few months because they spent too much money just trying to open.  To be fair, we have also seen franchises do the same.  Those people were also undercapitalized and did not get a realistic picture from a broker or a franchisor about what it will take to be successful. 

Does $25,000 to $50,000 sound a little bit more reasonable?  Here is another dirty little secret in franchising.  Franchisors lose money in selling the franchise.  They are looking long term in revenue from royalties. 

The next dirty word.

Like I had mentioned, we paid a lot of money in royalties.  To be perfectly honest, the support we received was sometimes very disappointing and we sought outside coaches and advisors.  You may have to do that too.  But what do royalties really get you?  I had mentioned support, but what is more important is the operational platform and backbone to automate and measure your business.  When we sit in on initial calls with our clients, we are always amazed at how much technology is woven into an operating system.  For example, you want to open a handyman business.  Seems simple enough, buy a van, wrap the van, buy tools, stock the van and start marketing.  Cha Ching.  If you bought a  Handyman Connection, for example, you would have their training, be coached through their quick start program, have a call center answer your incoming calls and schedule appointments, when the job is bigger than a simple quote – estimating software, and an Uber backed program that allows your customer to see who is coming and when.   Their software is so granular, you can see exactly where you are making money and where you need to improve your margins instantly.  Knowledge is power in your business.  I also forgot to mention they have national contracts with many retailers, real estate companies, and discounts. 

Still not convinced? 

Cultural FIT When Buying A Franchise

Question about buying a franchise

What is Company Culture and how do You Fit in?

Would you feel comfortable attending an annual conference where one of the activities is careening down a mountain with a crash helmet trying to beat someone’s time or attend a meeting where one of the activities is attending a professional baseball game?  Both franchises are fitness franchises – which do you fit in?  Maybe somewhere in the middle?

Culture is the backbone of the organization.  It is the sum of beliefs, attitudes, work style, and standards that create a unique brand.  It is their WHY.  It is what UNIFIES them.  It is how the organization STANDS OUT amongst their competitors.  It gives the system DIRECTION as to how they conduct their daily business.  A unified culture allows the people within to work better together, learn from one another and be the best they can be.  Every company has a culture.  Culture has a dramatic impact on bottom-line, thus getting in sync important.

The research our profile uses is based on Robert Quinn and John Campbell’s cultural indications.  They studied how culture motivates behaviors and saw key indicators bet

How do I know if franchising is right for me?
Is franchising right for me?

ween cultural compatibility and performance.  Take a moment to think about your career and where you felt comfortable within an organization or when you saw someone that just did not seem to belong.  Where is your mojo?  Working in a collaborative, creative, controlling or competitive environment?  Those are the basic types of culture simplified.

 

A controlling environment is one of unity, stability, integration and an internal focus.  There are rules for accountability along with incremental and long-term goals.  The system controls how to deliver the product or service – what is the next step or when to do it.  People appreciate and accept the system, like working within the box and follow a chain of command.  Work is undertaken with a sense of collective purpose and direction.  This type of system is the hierarchical structure – policy is dictated from the top down.

Why Company Culture Matters!

Imagine working within a system that makes you feel that your opinion or insight is not important?  This is how we have done things around here for 30 years is your standard reply.  How long would you last here?  How would you feel working in a large organization?  Are power and status important to you?  Are you more comfortable inside the box?  Are you looking to be a multi-unit owner?  This type of culture may work best for you.

A collaborative environment fundamentally different from the vertical, hierarchical structure of the controlling environment.  Flexibility, dynamism, internal focus, integration is dominating features of this culture.  Here is a system where best practices are shared and there is more of a give and take between franchisors and franchisees.  This system will be early adaptors of franchise councils and will look to their franchisees for input and feedback.  There is more of a family feel to the organization.  Everyone works collectively with a shared vision.  All talents are respected.

Are you the type of person that works well with others?  Are you able to set aside your ego for the collective?  Do you like working in a mentoring system or would you be more independent?  Do you have patience to collectively turn a ship around when it comes to change?  Can you work diplomatically?

A creative environment is the most flexible and dynamic type of culture.  It is the most innovative, fast moving, and most adaptive to quick changes in the marketplace.  Their external focus is what allows the organization to stay ahead.  To foster a creative environment, there is a high level of trust amongst all participants.  This is an organization that is not afraid to make a mistake.

Are you able to easily adapt and find a team of diverse employees that are adaptable? Are you a high-risk taker?  Are you yourself innovative and flexible?  Can you work within a less structured environment?  To foster creativity, you must show your employees that you have a high level of trust in them – are you comfortable if they mess up?  Do you need stability?  Can you herd cats?

The last type of culture is the compete culture.  This system has an external focus like the creative culture but there is a need for systems to fit the innovations.  There is a pulse on the market with a constant need and desire to do things better, cheaper and faster.  This is a hard driving, goal orientated winning system.  They form strategic alliances and partnerships to get better market share and penetration.  While not being averse to risk, this system is not as innovative, warm or friendly.  Their goal is to produce the best financial results.

Do you have a dominate personality that can get their point across clearly and concisely in a meeting?  Do you constantly think about how you can do things better?  Are your feelings easily hurt?  Can you work in a demanding, goal orientated environment?  Are you comfortable with some risk – or are you comfortable going “all in”?

Most people are a combination of cultures.  There have been as many as 39 different company cultures identified by people in lab coats.  What we try to do is the best match you with a type of cultural that will allow your talents to thrive.  There are about 30 different fitness franchises out there.  Each with a different culture and way they go to market.  Knowing where you would best fit in with help you be happier and more engaged.

Fast Facts

Per Dr. Stuart Brown:

Happy employees perform 20% better.

They are 12% more productive.

Take 10% less sick days.

They have 37% higher sales.

Are considering buying a franchise?

We have a scientific tool that combines both topological and dimensional scoring to achieve greater accuracy in predicting business success. So, if you are thinking about buying a franchise, take our test for FREE. Click on this link:  FREE Business Profile Assessment

We want you to be happy – we just won’t sell you a franchise based on a commission.

Owning a Low Cost Franchise

Freedom

Did you know you can own a low cost franchise business where you actually enjoy working?

Low cost franchise opportunities do exist and offer a great introduction into franchising.  These opportunities can be great for the candidate looking for something part-time, with minimal money to invest, can be a passive business, minimal or no employees and you can expand your net worth.  In addition to being low cost, some are great recession resistant opportunities because businesses need more business in any economy.

An ideal franchisee is an outgoing professional who enjoys interacting with others. You should be comfortable making presentations to small groups, organized, and upbeat. You should enjoy working with people and have a willingness to follow a proven method is a MUST.  After all you are buying a proven franchising system.

These opportunities can be run from your home office, a smart phone, iPad or tablet thus making it more affordable to get started.  Start small and grow.  All of the franchises have excellent support, cutting edge technology, some have high quality referral programs, award winning marketing programs and training to help make you successful.   All of this is included in your franchise fee.

The ideal candidate may need:

  • Solid business background
  • Sales and marketing oriented
  • Excellent communicator
  • Decision maker and problem solver
  • Relationship builder

There is a little known fact – many franchisors offer discounts for Veterans, Firefighters, Policemen, Emergency First Responders, minorities and multiunit discounts are available to those who qualify and can help stretch your investment dollars even further.

To get started, please contact us at:

1-888-246-0027 or mike@professionalfranchisebrokers.com

In the beginning

Time for a change

We never looked back

We bought our first franchise (YTD we have owned 6) back in 2001 pre 911. The economy was about to go through a Tech Bubble and we lived in Northern Virginia – just about a perfect storm. There is never a perfect predictorIn th of how outside conditions can influence your outcomes.

I knew my job at US Office Products was going to disappear as we were purchased by Corporate Express and I did not fit their corporate mold and Mike knew his days were numbered as the Tech Startup he worked at was cutting fat in order to be sold (laying off employees with false stock promises). This was in May of 2001.

At that time we began to look at our resumes riddled with jobs that lasted 3 to 5 years and the thought of having to look for another job every few years was most unappealing. That was the beginning of the “new economy.” We needed to break the cycle.

We took inventory of our skills and experiences. We did a SWOT analysis. We searched the internet. We visited some franchise brick and mortars. We researched and researched and then we asked my Dad for advice. We bought a book about franchising and read that cover to cover. Then we began to trust our instincts.